After 5 years of political stalemate and a mediation process led by the Southern African Development Community (SADC), presidential and legislative elections took place in Madagascar at the end of 2013. Mr. Hery Rajaonarimampianina was elected president and took office on January 25, 2014. Over the past 18 months, there was one government re-shuffle in January 2015 and a process of national reconciliation was initiated under the leadership of the president with the support of the Council of Christian Churches (FFKM). A conference organized by the FFKM developed a set of recommendations, including a call for the dissolution of some of the state institutions. These proposals fueled tensions between the executive and legislative branches, leading the National Assembly to call for the impeachment of the president and the dismissal of the government. Both motions failed but tensions remain.
Municipal elections aimed at picking mayors and municipal councilmen/women for 1,693 municipalities took place on July 31, 2015, marking the achievement of another milestone of the SADC roadmap. The participation rate, around 30% at the national level, was one of the lowest ever seen in Madagascar. The president’s party, New Forces for Madagascar (HVM), won mayoral seats in 62% of the municipalities, with the other large parties (the MAPAR, chaired by former president of the transition Rajoelina, and the TIM, led by former President Marc Ravalomanan) won in several of the main cities.
The Government of Madagascar has made the “fight against poverty through inclusive growth” its main objective and has developed a strategy centered on three pillars: improving governance, promoting economic recovery, and expanding access to basic social services. This strategy has been outlined in the Programme Général de l’Etat (PGE) and translated into a 2015-2019 National Development Program (Programme national de développement or PND) with an implementation plan.
Many international partners, who had not recognized the transitional government that came to power in 2009 through unconstitutional means, have normalized their relations with Madagascar in light of the last presidential elections.
The latest economic update published by the World Bank office reveals a slow economic recovery that is reflected in the decline of new business creation, job creation, and consumption of petroleum products. Catastrophic meteorological conditions have also taken a toll on the economy, resulting in higher inflation and a reduction of household purchasing power.
The ariary, Madagascar’s local currency, depreciated strongly in March against the US dollar, after being stable since mid-December 2014. Madagascar’s trade deficit narrowed and the import value decreased by 17% in the first quarter of 2015 compared to the same period in 2014, due to the decline in international energy prices and a reduction in rice imports. The export value increased by 12%, thanks to the volume of nickel and cobalt exports which offset lower prices and more favorable prices and production of cloves and vanilla. The performance of these products more than compensated for the decline in export values of shrimps, tuna and textile, the mainstay of the free economic zone (Zone franche).
The country continues to rank poorly on the ease of doing business index: 163rd out of 189 countries in World Bank Doing Business 2015 report. The Government has set a goal to improve its performance and has identified a series of improvements to be adopted over the next 18 months.
GDP growth is estimated at 3.4% in 2015 (3.3% in 2014), mainly driven by the extractive industry and the tertiary sector. Inflation was contained at 6% despite the gradual removal of subsidies on petroleum products.
Madagascar ranked 155th out of 187 countries in the United Nations 2014 Human Development Report and the country will not reach the United Nations Millennium Development Goals (MDG) by 2015. In particular, the MDGs for child mortality, primary education net enrollment and completion rates, and especially the eradication of extreme poverty, which in 2007 was deemed potentially achievable, can no longer be achieved.
Madagascar is also highly vulnerable to natural disasters—including cyclones, droughts and flooding. It is estimated that one quarter of the population, or approximately five million people, currently live in zones at high risk of natural disasters.
Last Updated: Sep 23, 2015